The US has had tariffs on Australian lamb for over a month now, and we can start looking for impacts in the data. The United States Department of Agriculture (USDA) publishes imported lamb prices, and we have April export data. Can we find weakening demand?
On the volume front, we did see April lamb exports to the US decline 7.5% from March, but we can see in Figure 1 that it was generally in line with the seasonal pattern. Lamb exports to the US were also down 8% in April 2024.
The US share of Australian lamb exports was 20% in April, still our largest single market, but losing share to China and other markets both last month and the April 2024 figures.
Lower export volumes to the US could be a factor of uncertainty, or the availability of the right product, or it could be weaker demand. Having a look at the price can give an indication of how demand is behaving.
The USDA has a vast array of data on agricultural products, and it’s highly useful for this sort of analysis. The lamb import price data is released weekly and gives a real-time idea of how US demand is performing.
Figure 2 shows the price of two of the highest volume lamb cuts exported to the US, the fresh short-loin, and frozen boneless leg. Both the Chilled Short loin and Frozen Leg remain priced relatively well compared to 2024, near the top of the range.
It is interesting to see the higher value short loin cut easing and the cheaper frozen leg price increasing in May. This could be an indication of demand shifting from foodservice to retail, as we generally see in tougher times economically.
If we convert the latest values to our terms, the short loin comes in at $19.70/kg and the leg at $15.30/kg.
Looking at other export markets, Figure 3 shows increasing market share for Europe and the UK, both reaching 5%, a level we haven’t seen since 2011 or 2012. Additionally, this year China has taken some share back from the Middle East and the US. It’s positive for lamb producers to see a wider range of markets when lamb prices are strong, and record volumes are being produced.
What does it mean?
April was heavily interrupted by public holidays, especially Easter, which moves around each year, and as such, it’s a little difficult to compare export volumes as an indication of demand. May and June will give a clearer picture.
However, it is promising to see imported lamb prices in the US remaining strong into May, suggesting demand from the US and other markets remains relatively strong.
Key Points
- Lamb exports to the US eased in April, but other markets have taken up the slack.
- Prices for lamb imported to the US remains relatively strong compared to the last 18 months.
- It’s promising for prices to see record supply finding homes in export markets.
Click on figure to expand
Click on figure to expand
Click on figure to expand
Data sources: MLA, Mecardo
